Subprime lender GO Financial has set the wheels in motion to debut a $180.1 million securitization on May 27. Loans backing the transaction have an average balance of $10,640, an average coupon of 20.1%, and an average term of 48 months. Credit scores in the deal average 535, though 30.3% of the loans have no credit score. Kroll Bond Rating Agency expects cumulative net losses for the securitization in the range of 34% to 37%, according to a May 12 presale report.
GO Financial was formed by a DriveTime Automotive Group Inc. management team in 2011. DriveTime owners Ernest Garcia II and Ray Fidel own 51% of the company; auction company Manheim bought the remainder in 2014. GO does business with 2,500 dealers in more than 40 states; it’s in the process of obtaining licenses in Connecticut, Massachusetts, New York, and Rhode Island, according to Kroll.
Last year, 86% of new dealer sign-ups were through NextGear, Manheim’s dealer floorplan unit. As of March 31, GO had a managed portfolio of $474 million and a $200 warehouse facility with Deutsche Bank.